HSBC cuts 500 jobs as unit closes
HSBC Bank Canada is winding down its HSBC Financial consumer lending business in a move that will put 500 people out of work after the bank failed to find a buyer for the business.
The company said Wednesday the decision affects 75 HSBC Finance offices in Canada that are operated on a stand-alone basis from HSBC Bank Canada branches.
The closure does not affect HSBC's banking operations in Canada.
"This move, while not taken lightly, will allow HSBC to better focus our resources on the core businesses that matter most to our Canadian banking customers," said Lindsay Gordon, chairman of HSBC Financial and president and chief executive of HSBC Bank Canada.
"Despite concerted efforts, a suitable buyer could not be found. Having exhausted all available alternatives, the appropriate steps are now being taken to wind down the business."
The company will continue to service and collect its existing loans and provide customers with call centre support, but it will stop taking new loan applications as soon as practical.
HSBC Canada's biggest foreign-owned bank
The company noted there would be no impact on HSBC Financial's medium-term notes which will be paid on their scheduled maturity in May.
HSBC Financial is the legacy business of Household International, which was acquired by HSBC in 2003 and has already been wound down in the U.S. and the U.K.
The business offered mortgages, lines of credit and term loans.
Last year, HSBC sold its Canadian full service investment advisory business to National Bank of Canada for $206 million in cash.
The sale followed an announcement by HSBC Canada's corporate parent that it would cut 30,000 jobs worldwide by 2013 and sell almost half its U.S. retail bank branches.
Vancouver-based HSBC Bank Canada, a unit of HSBC Holdings PLC, one of the world's largest banking and financial services companies, is Canada's biggest foreign-owned bank with about 8,000 employees and over 140 bank branches.